GUANGZHOU, Dec 6 (SMM) – As consumption grew faster than supply, the inventory destocking cycle across Chinese aluminium market lasted for an extended period in 2018 and is expected to continue in 2019 with broad-based supply cuts, said Liu Xiaolei, SMM senior analyst.

Liu expects primary aluminium consumption in China to grow by 4.5% in 2018 and by 3.3% in 2019. SMM data showed that China’s actual consumption of primary aluminium increased by 7.9% in 2016 and by 9.1% in 2017.

Growth of primary aluminium output in China is estimated to stand at 0.6% in 2018 and to quicken to 3.6% in 2019. Output expanded by 3.9% in 2016 and by 14.2% in 2017.

With waning cost supports, the most traded SHFE aluminium contract is likely to trade at 13,000-14,500 yuan/mt in the first half of 2019 with its LME counterpart at $1,850-2,050/mt, Liu expects. In the second half of the year, prices are expected to strengthen to 13,500-15,000 yuan/mt for SHFE aluminium and $1,900-2,100/mt for LME aluminium.

GUANGZHOU, Dec 6 (SMM) – As consumption grew faster than supply, the inventory destocking cycle across Chinese aluminium market lasted for an extended period in 2018 and is expected to continue in 2019 with broad-based supply cuts, said Liu Xiaolei, SMM senior analyst.

Liu expects primary aluminium consumption in China to grow by 4.5% in 2018 and by 3.3% in 2019. SMM data showed that China’s actual consumption of primary aluminium increased by 7.9% in 2016 and by 9.1% in 2017.

Growth of primary aluminium output in China is estimated to stand at 0.6% in 2018 and to quicken to 3.6% in 2019. Output expanded by 3.9% in 2016 and by 14.2% in 2017.

With waning cost supports, the most traded SHFE aluminium contract is likely to trade at 13,000-14,500 yuan/mt in the first half of 2019 with its LME counterpart at $1,850-2,050/mt, Liu expects. In the second half of the year, prices are expected to strengthen to 13,500-15,000 yuan/mt for SHFE aluminium and $1,900-2,100/mt for LME aluminium.